【Key Policy】The Gansu Provincial People's Government issued the "Implementation Plan on Promoting Large-scale Equipment Renewal and Consumer Goods Trade-in" to promote the development of petroleum equipment remanufacturing industry
On April 22, the Gansu Provincial People's Government issued the "Implementation Plan on Promoting Large-scale Equipment Renewal and Trade-in of Consumer Goods" (hereinafter referred to as the "Plan").
The plan proposes that by 2027, the province's industrial, agricultural, construction, transportation, education, cultural tourism, medical and other fields of equipment investment scale will increase by more than 25% compared with 2023;
The plan promotes the standardized construction of liquefied petroleum gas filling stations and the renewal of construction equipment, and promotes the development of petroleum equipment, construction machinery and other remanufacturing industries with a good industrial foundation in our province.
Comments: As the core strategic resources of the mainland, the stable supply of oil and gas is crucial to the guarantee of national energy security. With the vigorous development of the mainland economy and the continuous improvement of people's quality of life, the demand for energy is becoming increasingly strong. In this context, oil and gas gradually occupy an important position in the mainland's energy structure.
In recent years, with the continuous growth of the global economy, the demand for oil and gas has continued to rise, which has promoted the rapid development of the global oil drilling equipment industry. In order to meet this growing energy demand, it is an urgent need for the industry to improve mining efficiency and reduce operating costs. Therefore, it is particularly important to update and upgrade oil and gas equipment and equipment.
The introduction of the "Plan" aims to further improve the efficiency of oil and gas extraction, processing, transportation and other links by promoting large-scale equipment renewal, reduce energy consumption and emissions, and promote the green and sustainable development of the industry. This will not only help enhance the competitiveness of the mainland's oil and gas industry, but also lay a solid foundation for achieving the goal of green and low-carbon development.
In addition, the "plan" also actively promotes the development of petroleum equipment and other remanufacturing industries in Gansu Province. As an environmentally friendly industry, the remanufacturing industry can effectively realize the recycling and value enhancement of waste equipment, which is of great significance for promoting the green development and circular economy of the oil and gas industry. Through the development of the remanufacturing industry, it can not only reduce production costs and improve economic benefits, but also promote the effective use of resources and environmental protection, and achieve a win-win situation of economic and environmental benefits.
Figure 1: China's oil and gas production from 2017 to Q1 2024
Source: National Bureau of Statistics, Zhiyan Consulting
【Key Policies】The Ningbo Municipal Development and Reform Commission issued the "Several Policies and Measures of Ningbo to Promote the High-quality Development of the Private Economy in the New Era" to promote the supply and price stability of natural gas
On April 22, the Ningbo Municipal Development and Reform Commission issued the "Several Policies and Measures of Ningbo to Promote the High-quality Development of the Private Economy in the New Era" (hereinafter referred to as the "Measures").
The "Measures" proposes to further promote the supply and price stability of natural gas, steadily reduce the cost of natural gas transmission and distribution, and promote direct transactions and group procurement between urban gas and large industrial users and upstream natural gas resource parties.
Swedish Foreign Minister said the EU will target Russian LNG in the 14th round of sanctions
On April 21, Swedish Foreign Minister Tobias Billstrom announced that the European Union plans to add Russian LNG to the scope of sanctions against Russia in the 14th round.
Russia is currently the EU's second-largest supplier of LNG after the United States, accounting for 16% of total global imports last year. Since the outbreak of the Russia-Ukraine conflict, the EU has gradually reduced its pipeline gas imports to Russia. But some EU member states are mulling new plans to ban Russian natural gas as well.
Billstrom revealed that the next round of sanctions could include a ban on EU countries importing Russian LNG and a further blow to Russia's shadow fleet.
However, just last week, the European Union's energy regulator ACER warned that the EU would still need to import Russian LNG to avoid an energy shock. It is difficult for the EU to strike a balance between its own energy security and cutting Russian gas purchases to hit Russia's finances.
【Key Event】The remaining technical recoverable reserves of mainland oil are 3.85 billion tons
On April 22, the latest data showed that by the end of 2023, the country's remaining technical recoverable reserves of oil were 3.85 billion tons, a year-on-year increase of 1.0%, natural gas remaining technical recoverable reserves were 6,683.47 billion cubic meters, a year-on-year increase of 1.7%, and shale gas remaining technical recoverable reserves were 551.61 billion cubic meters. The new proved geological reserves of coalbed methane exploration were 317.93 billion cubic meters, of which 161.34 billion cubic meters were newly proved and technically recoverable, a year-on-year increase of 712.1%.
Gazprom shut down more than 20 gas production wells in the Orenburg region to protect them from flooding
On April 22, Gazprom said it had to shut down more than 20 gas production wells in the Orenburg region to protect them from flooding.
【Key Events】The United Arab Emirates, Qatar and other countries participated in infrastructure projects in Iraq, opening up new channels between the Middle East and Europe
On April 22, after a year of preparation, the United Arab Emirates, Turkey, Qatar and Iraq jointly signed a memorandum of understanding on the "Road to Development" project, which means the official launch of the project. The project will serve as a new gateway between the Middle East and Europe.
The "Road to Development" project is the "main artery" that Iraq intends to build through the north and south of the country. Among them, electrified railways and roads are about 1,200 kilometers long, stretching from the port of Faw in southern Iraq to the Iraqi-Turkish border region, passing through major Iraqi cities such as Basra, Baghdad and Mosul, and finally to Europe via Turkey.
The project will see the construction of 15 stations, logistics centers and industrial cities along the territory of Iraq, as well as the construction of oil and gas pipelines. The project is expected to cost about $17 billion. The route extends within Turkey to the port of Mersin on the eastern shore of the Mediterranean, connecting to the Mediterranean route. The first phase of the project is expected to be completed in 2028.
One end of the "development path" involves the construction project of the port of Faw in southern Iraq, which has been underway for many years. It is the only port in Iraq capable of receiving large ships and is expected to be the largest port in the Middle East. Iraq's Faw port and the "Development Road" project, known as the country's "Silk Road", could make it a transportation hub between Asia and Europe.
When completed, the project is expected to reduce transit time by 20 to 25 days compared to the sea route to Europe via the Suez Canal, generate $4 billion in annual revenue for Iraq, and create at least 100,000 jobs.
In the middle of last year, Iraq pursued the project ambitiously, with the support of several GCC member States. At the signing ceremony, the Iraqi side revealed that a number of multinational companies are interested in participating in the project.
The project will establish Iraq as an important trade and transport centre. AD Ports has announced that it has won the concession rights to the new port of Faw Port in Iraq, and will form a joint venture with Iran to participate in the construction of the port and its economic development zone.
Historically, Iraq was known as the "land between the two rivers" because it connected the Tigris and Euphrates rivers and was an ancient trade route between the Persian Gulf and the Mediterranean, which was jointly developed by Iraq, Turkey and Syria since 1950. But during the 1991 Gulf War and the subsequent US-Iraq war, the trade route's infrastructure was severely damaged.
【Key Event】The gas pipeline between Finland and Estonia, which was shut down due to leakage, resumed ventilation
On April 22, according to a report by the Finnish Broadcasting Corporation on April 22 local time, the repair of the submarine gas pipeline connecting Finland and Estonia has been completed, and it has been ventilated early in the morning of the 22nd. In October last year, the gas pipeline from Finland to Estonia burst. According to the Finnish Broadcasting Corporation, the restoration work cost nearly 40 million euros.
Foreign media: U.S. sanctions against Iranian oil may be signed into law this week
On April 23, Bloomberg reported that a bill to sanction Iranian crude oil is expected to become law as early as this week, but Biden may not act immediately.
The U.S. House of Representatives passed the bill over the weekend, pledging to expand restrictions on Iranian crude exports to include foreign ports, ships and refineries involved in the trade.
But oil market analysts said Biden may be reluctant to take any action that could push up the price of crude oil or gasoline at gas stations. Policy experts say he may use the immunity contained in the sanctions policy to avoid strict enforcement of the policy.
This is the same scenario as when the United States imposed sanctions on Russia. While the United States has imposed sanctions on Russia, it has worked to limit Russia's revenues while allowing its oil to continue to be exported so as not to squeeze global supplies and trigger inflation. In addition, despite the reinstatement of sanctions against Venezuelan President Nicolas Maduro, it has allowed the country's oil to continue to enter the market.
Jim Lucier, managing director of research firm Capital Alpha Partners, said: "Oil traders are not taking this bill to heart because they know that Biden will definitely sign all the necessary waivers to allow Iranian oil to continue to enter the market, just like Russian oil." ”
Russian media: Russia became China's largest supplier of pipeline natural gas in February
On April 23, Gazprom became China's largest supplier of piped natural gas in February, surpassing Turkmenistan, which has long dominated the list, according to the website of Russia's "Independent" newspaper on April 23. Including LNG exports to China, Russia is ahead of all other foreign suppliers in the Chinese market.
According to the report, in 2023, Russia will export 22.7 billion cubic meters of natural gas to China through the "Power of Siberia" gas pipeline, an increase of 50% over the previous year, and revenue will increase by 60% to $6.4 billion. Turkmenistan's revenue from pipeline gas supply to China during the same period was close to $10 billion.
Novikova, an expert at Russia's Plekhanov University of Economics, pointed out that Asia can be regarded as a market on a par with Europe, and China's natural gas demand has great growth potential, however, Asia is unlikely to replace the demand of the European market soon, and the pipeline capacity infrastructure for Asia is also insufficient.
According to reports, Russia originally planned to increase the annual production of liquefied gas and natural gas to 100 million tons by 2030, and due to sanctions, the project may not be fully implemented, but considering the demand of the Asian market and the development of domestic liquefaction technology, reaching 80 million tons is feasible. However, the EU may include Russian LNG in the new package of sanctions, the Swedish Foreign Minister mentioned the possibility at a meeting of EU officials on the 22nd. (Compiler/Tong Shi Group)
The head of the Ukrainian gas department said that Ukraine will not negotiate with Russia on the gas transit agreement
On April 23, the head of Ukraine's gas department said that Ukraine would not negotiate an agreement with Russia on gas transit.
European Commission President Ursula von der Leyen said that it may soon turn from a global shortage of liquefied natural gas (LNG) to an LNG surplus
On April 23, European Commission President Ursula von der Leyen said that there could soon be a shift from a global liquefied natural gas (LNG) shortage to an LNG surplus, with natural gas prices expected to fall.
【Key Events】Geopolitical risks have eased, and the world's largest oil ETF has suffered historic capital outflows
On April 23, the US Oil Fund, the world's largest oil ETF, saw its largest one-day outflow on record, as crude prices lost some of the geopolitical premium from Iran-Israel tensions. The $376 million divestment surpassed the previous record of $323 million set in 2009. The previous two trading days saw similar large-scale inflows. After the pullback, the U.S. oil fund with $1.3 billion in assets remains the largest oil ETF.
On the same day, the price of light crude oil futures for June delivery on the New York Mercantile Exchange fell 55 cents, or 0.66%, to close at $82.81 a barrel; London Brent crude futures for June delivery fell 40 cents, or 0.45%, to settle at $88.02 a barrel.
Oil prices rebounded before Iran launched missile and drone strikes on Israel. Over the weekend, crude oil prices experienced another round of volatility after it was reported that Israel had launched a retaliatory strike against Iran. U.S. crude futures are trading about $5 below pre-attack levels, and the oil market has become more optimistic about the risk of further escalation, although political tensions remain high.
John Love, chief executive of USCF Investments, which manages the U.S. oil fund, said: "This event comes at a time when tensions in the Middle East generally eased over the weekend. Given the tensions leading up to the attack, this is likely to be an event-driven sell-off. ”
Foreign media: Ukraine admits to attacking Russian oil storage facilities
On April 24, Ukrainian defense sources said that Ukrainian drones launched attacks on oil storage facilities in western Russia.
According to previous reports, the governor of Russia's Smolensk region said on the 24th that a number of fuel and energy facilities in the state were attacked by Ukrainian drones and caused fires.
RIA Novosti later quoted the Ministry of Emergency Situations as saying that seven Ukrainian attack drones were involved in the attack on two fuel and energy facilities in two places in Smolensk Oblast. There were no casualties as a result of the incident.
Agence France-Presse said that hours after Russian officials announced the attack, Ukrainian sources told the media that "drones from the Security Service of Ukraine attacked two oil depots in Smolensk Oblast."
【Key Companies】Saudi Aramco signed a Memorandum of Understanding (MoU) with Hengli Group
On April 22, Saudi Aramco, an energy giant with a market capitalization of nearly $2 trillion, announced that it had signed a memorandum of understanding with Hengli Group on the potential acquisition of a 10% stake in Hengli Petrochemical.
Following the signing of the MoU with Hengli Group, Aramco's President of Downstream Operations, Mohammed Y.Al Qahtani, said the MoU supports the company's efforts to continue to expand into the global downstream market. Aramco will continue to look for new opportunities in key markets and continue to drive its "From Oil to Chemicals" strategy. The company looks forward to new partnerships with new partners and is excited about expanding its presence in the important Chinese market."
Saudi Aramco's rationale behind the purchase of stakes in Chinese companies has long been made public: to secure buyers of oil and production capacity for petrochemicals through a small stake deal.
Saudi Arabia believes that even though the future use of oil as fuel in the global energy transition may decrease, the demand for petrochemicals such as plastics will continue to grow in the coming decades. As a result, these Chinese companies involved in Aramco's acquisitions are all very important in the refining and chemical sector. Hengli Petrochemical has a 400,000 barrels per day refinery and integrated chemical plants in Liaoning Province, as well as factories and production facilities in Jiangsu and Guangdong.
Saudi Aramco President Amin Nasser also attended the 2024 China Development Forum at the end of March. In his speech, he mentioned five key areas for investment cooperation with China, starting with chemicals.
Amin said that China already accounts for 40% of global chemical sales, and Saudi Aramco has a majority stake in SABIC, the world's leading chemical company, and has the world's top chemical capabilities. This will help Saudi Arabia achieve its goal of converting 4 million barrels of crude oil per day into chemicals by 2030.
【Key Enterprise】The world's largest ethane dual-fuel carrier built by Jiangnan Shipbuilding was delivered in Shanghai
On April 22, the world's largest 99,000 cubic meter ultra-large ethane dual-fuel carrier (VLEC) series lead ship (H2781 ship) built by Jiangnan Shipbuilding, a subsidiary of China State Shipbuilding Corporation (CSSC), was officially named and delivered.
This type of ship is independently developed and designed by Jiangnan Shipbuilding, especially its core cryogenic cargo enclosure system is a B-type cabin independently innovated and developed. With a total length of 230 meters, a width of 36.6 meters and a depth of 22.5 meters, this type of ship is classified by the American Bureau of Shipping, suitable for transporting ethane, ethylene and LPG and other liquefied gases, and has the advantages of low oil (gas) consumption, low evaporation rate, no liquid level loading restriction and low maintenance cost.
This type of ship is the best type of ship "tailor-made" for long-distance transportation of ethane, and has won the highest award in the shipbuilding industry - the special prize of science and technology. It is reported that so far, Jiangnan Shipbuilding has held 32 VLEC orders, accounting for 80.2% of the global market share in terms of capacity, which also marks that the VLEC designed, built and adopted by China has reached the world's leading level.
【Key Project】The ADNOC LNG project is particularly eye-catching, and Shell and Total are considering a "piece of the pie"
On April 23, several global energy giants, including Shell and Total, were in talks to take a stake in Abu Dhabi National Oil Co.'s (ADNOC) next liquefied natural gas (LNG) export project in the United Arab Emirates.
The Adnoc-owned LNG project, which is currently located in Abu Dhabi's Ruwais, will have the capacity to export 9.6 million tonnes of LNG per year, which is more than double the UAE's current total production. According to a person familiar with the project, ADNOC has signed enough initial and final supply agreements.
The two oil majors, as well as Japanese trading company Mitsui & Co., are seeking an equity stake in the Ruwais facility, as well as a contract to buy liquefied natural gas from the facility, people familiar with the matter said.
However, ADNOC may not need investment from energy companies to advance the project, the person added, and may decide not to sell its stake. A final investment decision on the project could be made as early as next month.
Mitsui & Co. responded in an email that no decision had been made at this time.
Natural gas is playing an increasingly important role in the Middle East as an important bridge in the transition to clean energy, and countries are seeing strong demand for this fuel.
Although the International Energy Agency (IEA) believes that gas demand will peak in 2030, the Gulf countries are still increasing their investment in natural gas.
The UAE is trying to increase production capacity and expand its role as a LNG trader, Saudi Arabia is looking for overseas investment projects, and Qatar, one of the world's largest LNG suppliers, is also investing heavily in expanding production.
The Das Island facility, another LNG export plant in the UAE, is currently its only LNG export plant with a capacity of 5.8 million tonnes per annum of LNG and is owned by ADNOC LNG. ADNOC, Mitsui, BP and TotalEnergies all hold stakes in the project.
【Key Enterprise】Baitian Petroleum (08011.HK) HK): Cancellation of listing on April 29
On April 24, Baitian Petroleum (08011. HK) announced that with effect from 9 a.m. on 29 April 2024, the listing of Pak Fields Petroleum International Group Limited (in liquidation) will be cancelled in accordance with Rule 9.14A(1) of the GEM Rules.
【Key Enterprise】Binhai Investment (02886.HK): Signed an annual natural gas purchase and sales contract with Beiran Tianjin
On April 24, Binhai Investment (02886.HK) announced the announcement on the signing of a natural gas purchase and sales contract between Shenzhen Binhai Energy, a wholly-owned subsidiary of the company, and Beiran Tianjin, a wholly-owned subsidiary of Beiran Group, and the announcement of the strategic cooperation framework agreement between Binhai Investment (Tianjin) Co., Ltd., a wholly-owned subsidiary of the company, and Beiran Tianjin.
Shenzhen Binhai Energy and Beijing Gas Tianjin have renewed their annual natural gas purchase and sales contracts to supply natural gas to Shenzhen Binhai Energy to support the Group's gas business in the Beijing-Tianjin-Hebei region of the PRC. According to the purchase and sale contract, Beijing Gas Tianjin will provide competitive gas prices to meet the large-scale gas purchase needs of Shenzhen Binhai Energy.
The Company believes that the renewal of the subscription and sales contract indicates that the Group and Beiran Tianjin continue to fulfill their cooperation commitments under the strategic framework agreement on the basis of mutual benefit and reciprocity. The further cooperation with Beiran Tianjin is conducive to the Group's continuous expansion and improvement of its own natural gas resource pool construction and allocation capabilities, optimize the upstream gas source structure, reduce procurement costs and improve profitability. The Group and Beiran Tianjin will continue to consolidate and deepen all-round and multi-field cooperation, give full play to the advantages of resource synergy, improve their respective natural gas supply chain systems, contribute to the Beijing-Tianjin-Hebei natural gas mutual insurance, and promote the sustainable and high-quality development of the industry.
【Key Enterprise】Eni Petroleum (E.US) Q1 profit was in line with expectations, and the scale of share repurchases was expanded to 1.6 billion euros
On April 24, Eni Petroleum (E.US) reported first-quarter results that were in line with expectations, while the company increased its share buyback program to 1.6 billion euros ($1.7 billion) this year due to strong cash flow.
Although the Italian energy giant's natural gas business profits fell sharply from a year earlier, profits in its exploration and production (i.e., upstream) division have proved resilient, and the company has raised its expectations for oil prices this year.
In a statement, CEO Claudio Descalzi said: "As we strive to grow our upstream business efficiently, this achievement puts the company firmly on track to exceed full-year earnings and cash flow guidance. ”
The company's share price rose on the Milan stock market following the earnings report.
According to the statement, Eni expects operating cash flow (working capital net of replacement costs) of 14 billion euros this year, up from 13.5 billion euros previously, which makes its buyback amount 45% higher than the 1.1 billion euros announced earlier this year. Brent crude oil is expected to be $86 a barrel this year, up from $80 previously.
【Key Project】The world's largest metamorphic rock oilfield was officially drilled
On April 24, CNOOC announced that the first phase of the Bozhong 26-6 condensate oilfield development project in Bohai Oilfield officially started drilling, opening the prelude to the development of the world's largest metamorphic rock oilfield.
The Bozhong 26-6 condensate oilfield is located in the southern part of the Bohai Sea, about 170 kilometers away from Tianjin, with an average water depth of more than 22 meters. In 2024, the new proven geological reserves of oil and gas will exceed 40 million cubic meters, and the cumulative proven geological reserves of the oilfield will exceed 200 million cubic meters, making it the world's largest metamorphic rock oilfield.
It is estimated that the Bozhong 26-6 oilfield can extract more than 30 million cubic meters of crude oil, which can meet the daily transportation needs of urban residents with a population of one million for more than 20 years after being refined into gasoline, and can extract more than 11 billion cubic meters of natural gas, which can meet the household gas of urban residents with a population of one million for more than 60 years, which has considerable social and economic benefits.
Liu Baosheng, general manager of the engineering technology operation center of CNOOC Tianjin Branch, said that the average well depth of the Bozhong 26-6 oilfield development project is 4,835 meters, the maximum well depth is 5,049 meters, and the drilling footage is expected to exceed 160,000 meters, which is equivalent to the height of 18 Mount Everest. The target layer is the Archean buried hill metamorphic rock strata, which is a bedrock bulge covered by new sedimentary rocks in the paleogeological history period billions of years ago, that is, the ancient mountain is covered, and it sinks to a depth of several thousand meters underground with the passage of time, which belongs to the bedrock paleolandform. The project has once again laid a solid foundation for the exploration and development of the offshore oil industry in the mainland to move towards the deep and complex field.
It is understood that the buried hill bedrock is mainly high-hardness granite, with an average compressive strength of 137-275 megapascals, nearly 9 times more than concrete, and even higher than the strength of cast iron. Due to its deep burial, the temperature of the formation reaches 178 degrees Celsius. This extreme operating environment of high temperature and high intensity brings a severe test to the reliability of drilling instruments and equipment. In order to ensure the efficient development of the oilfield, CNOOC Limited has promoted the improvement of drill bits, high-temperature mud systems, supporting speed-up tools and high-temperature directional well instruments, and completed targeted improvements to the drilling rig equipment, especially the upgrading and optimization of high-torsion drilling tools to reach the leading level in China, ensuring the smooth development and production of oilfields.
Yu Guimin, Deputy General Manager of CNOOC Tianjin Branch, said, "Bozhong 26-6 is the world's largest buried hill metamorphic rock oilfield, and its successful exploration and development has increased the confidence and confidence of the Bohai Oilfield to produce 40 million tons of oil and gas annually, and has enhanced the key core technology research of offshore deep drilling and completion in the mainland, and continued to forge ahead towards the development of deep ocean energy." ”
【Key Projects】Total and OQ will launch a US$1.6 billion LNG bunkering station project in Oman, which is the first LNG bunkering station project in the Middle East
On April 25, the Financial Associated Press reported that according to the latest agreement signed between Oman's national oil company OQ and TotalEnergies, Oman's Sohar Port will build a new $1.6 billion liquefied natural gas bunkering station (Marsa LNG).
Through the joint venture Marsa Liquefied Natural Gas LLC, TotalEnergies will provide 80% of the investment, with the remaining 20% to be injected by OQ.
Marsa LNG is the first LNG bunkering station project in the Middle East and is expected to have a significant economic impact. The project is expected to generate additional direct revenue for Oman, increase traffic at the local port, and promote local investment.
In addition, the project will expand the gas and alternative energy supply network and create new jobs in Oman.
Salim Al-Aufi, Oman's Minister of Energy and Mines, said: "Marsa LNG is one of many initiatives to drive Oman's goal of achieving carbon neutrality by 2050. ”
The planned bunkering station, which will be powered entirely by solar energy, is expected to help reduce carbon emissions and the overall carbon footprint of the shipping industry.
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